South Africa: AB InBev’s South African business grows its profit in the first quarter of this year
Despite a month-long ban on the sale of alcohol, Anheuser-Busch InBev says its South African business managed to grow its profit in the first quarter of this year, News24 reported on May 6.
The ban was instated on 28 December, but once lifted at the start of February, there was strong demand for its products, the company said. South Africa’s SAB, which produces Castle and Carling Black Label among other brands, is a unit of AB InBev.
Compared to the same quarter in 2019, South African sales volumes were flat, but declined “slightly” compared to the previous quarter.
But revenue per hectolitre sold grew by low single digits, and the South African operations delivered growth in EBITDA (earnings before interest, taxes, depreciation, and amortisation), thanks in part to cost discipline, the company said. Its premium brands - driven by Corona beer and flavoured alcohol beverages like Brutal Fruit - fared particularly well.
In January, SAB suspended hundreds of temporary jobs in reaction to the alcohol ban. Due to the ban, it is also demanding that its investment and employment commitments - which it agreed to, to get approval for its merger with AB InBev five years ago - must be set aside.
Across the world, AB InBev saw 13% growth in total volumes, while its EBITDA increased by more than 14%. Its underlying profit breached $1 billion in the three months.
The company also announced that Carlos Brito will step down as CEO after 15 years in the position. Michel Doukeris, president of the group’s North America business, will be his successor.
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